NOTICE OF DISCIPLINARY ACTION

NON-MEMBER:

ZHENGYU LIAO

RULE VIOLATION: NYMEX RULE 432. GENERAL OFFENSES (IN PART)

It shall be an offense:

L. 2. to fail to fully answer all questions or produce all books and records at such hearing or in connection with any investigation, or to make false statements.

NYMEX RULE 576. IDENTIFICATION OF GLOBEX TERMINAL OPERATORS

Each Globex terminal operator shall be identified to the Exchange, in the manner prescribed by the Exchange, and shall be subject to Exchange rules. If user IDs are required to be registered with the Exchange, it is the duty of the clearing member to ensure that registration is current and accurate at all times. Each individual must use a unique user ID to access Globex. In no event may a person enter an order or permit the entry of an order by an individual using a user ID other than the individual’s own unique user ID.

FINDINGS:

On April 9, 2019, a Panel of the New York Mercantile Exchange (“NYMEX”) Probable Cause Committee charged Zhengyu Liao (“Liao”) with violating NYMEX Rules 432.L.2. and 576, based on allegations that Liao failed to fully answer all questions in connection with an investigation and for making false statements and for permitting the entry of an order by an individual using a user ID other than the individual’s own unique user ID.

On June 7, 2019, a Hearing Panel Chair of the NYMEX Business Conduct Committee (“BCC”) entered an order finding that Liao failed to answer the charges against him. The Hearing Panel Chair further ordered that Liao was deemed to have admitted the charges issued and waived his right to a hearing on the merits of the charges.

On June 26, 2019, a penalty hearing was held before a panel of the NYMEX BCC (“BCC Panel”) which found that Liao had committed the violations charged.

PENALTY:

In accordance with NYMEX Rule 402.B (Sanctions), the BCC Panel ordered Liao to serve a permanent ban from membership privileges, access to any CME Group, Inc. trading floor, and direct and indirect access to all electronic trading and clearing platforms owned or controlled by CME Group, Inc.